May 9, 2011

Greeks turn tragedy into a drachma

Posted in Banks · 121 comments ·

By playing hardball with the French and Germans this weekend, Greece has bravely sparked a liberation which could topple the eurozone as we know it – and not a minute too soon

If you have ever tried to learn German, you will know that reading it is much more difficult than speaking it. The problem is the sentence construction, and the fact that the verb generally comes at the end of the sentence. So you spend ages trying to read practically backwards – or at least this particular grammatically-challenged student did.

Like all languages, after awhile there comes a time when your teacher gives you articles from a local paper to see if you can make out what is going on. I just about understood what the mass-market Bild was saying, but the real challenge was to figure out what was written in Der Spiegel.

In fact, German friends of mine used to joke that Der Spiegel was so highbrow and its readership so well-educated that even they had difficulty understanding the grammar it used. Der Spiegel uses the German of Schiller, Goethe and Heine. It is Germany’s paper/magazine of record, not given to running stories without foundation.

Its credibility has been bolstered in recent weeks because it has clearly been getting accurate leaks from German government sources about the thinking both in Berlin and Frankfurt.

Therefore, the news published late last Friday afternoon in the online version of Der Spiegel, that Greece would leave the euro this weekend, caused the markets to react violently. The euro has plummeted against a feeble dollar. The German leak stated that certain eurozone finance ministers – the ones from the richer countries – were meeting this weekend in the exclusive surrounds of Château de Senningen in Luxembourg, with the Greeks indicating that, if they didn’t get a deal on their debts, they would pull out of the euro. The usual denials followed the rumours, but it is clear that the Greeks are playing hardball – and good on them.

The Greeks know that, like us, their debt is unsustainable and that there is no way they can avoid default. They also know that their economy can’t take more austerity. Greece has already missed some IMF targets, and will miss more. The markets decided months ago that the Greeks would default – the issue for investors is how and when, not if. The same goes for us.

The Greeks also know that the one thing the Germans and French – particularly the French – don’t want is a ‘conditional’ euro, where commitment to the currency is conditional on whether it suits a country or not at a certain time in the economic cycle. The idea that a country could pull out is anathema to the French and German establishments, but this is exactly where their banks’ reckless lending to the likes of Greece and Anglo Irish has led us.

Anyone who has any knowledge of economics realises that a strong currency makes a weak economy, like Greece’s, weaker. We also know that, when debt can’t be paid, it won’t be paid. We also know that a balance sheet like Greece’s, which is carrying too much debt, is never made stronger by yet more debt. It is made stronger by less debt.

There are only two ways you can lessen debt. The first is when the economy grows strongly, generating the tax revenue to pay off all the debt without much effort. This clearly will not happen in either Greece or Ireland. The other way is when you do a deal and default.

Obviously, this is what the Greeks will do this weekend and, just to focus the minds of the rest of Europe, they have indicated that, if they don’t get a deal, they are off and will introduce a new drachma and leave the outstanding debt issues to the lawyers to sort out who gets what and when.

How would bringing the drachma back help them? First, they would announce that, from tonight, one new drachma is equal to one euro, and all former euro debts will be paid in drachmas at the prevailing exchange rate. At the moment of recalibration, all the old euro debts are to be paid in drachmas which, at that moment, have an exchange rate of one to one. So all the old euro debts are converted to drachma at an immediate exchange rate of one to one. So no default yet.

Then, they will announce that the drachma will be a free-floating currency. The currency’s value will fall like a stone, possibly by as much as 70 per cent. This will wipe out much of Greece’s debt problem at a stroke. But it’s not that simple, because the people who are owed money by Greece will be livid – and will demand payment.

The Greeks will have figured out in advance how much is owed by foreigners and how much is owed by locals. They will clearly be keener to default on foreigners than locals. This is what the Russians did in 1998,whenRussia defaulted on rouble-denominated debt, knowing that foreigners – greedy for yield – had bought up the rouble-denominated debt. The Russians roasted the foreigners and gave the lawyers headaches.

The same would happen if Greece pulls out of the euro – a prolonged legal battle between creditors and Athens would ensue. The Greeks would then print the new currency and inflation would rise, resulting in a greater haircut being taken by the creditors because, the higher the Greek inflation, the more the drachma would fall and the more the creditors would lose.

Greek banks that hold Greek government debts would see the ‘drachmasation’ of their assets, which would undermine greatly the value of these banks in euro terms. However, in terms of the currency they lend in, the change would not be that huge.

Middle-class Greeks would take all their money out of the country and this money would wait offshore until the crisis settled down. The government would probably have to enforce capital controls for a time to make sure that it could have some control over where the currency went.

It would be chaotic but, like the Asian Tiger devaluations, it would pass and the country would recover. The economy adjusts. If you think the like of this is unusual, it is not. This is what Finland and Sweden did in 1993.They both sacrificed the interests of their creditors – both local and foreign – for the long-term interests of the economy. And it worked.

The competitive gains that both Finland and Sweden enjoyed from devaluing their currencies in 1992 lasted well into the 2000s.The British are regularly at the same game.

The difference in devaluing your currency and leaving a currency union is one of perception. The former is not likely until it happens and then life goes on; the latter is inconceivable until it happens, and then life goes on.

The country becomes more competitive, holidays in Greece are cheaper, exports from Greece are cheaper, the Greeks will price assets in euro for a while – this is a process which will be known as ‘eurosation’ and is already a reality in most Balkan countries anyway.

For example, if you want to buy an apartment in Croatia or Serbia, the price will always be given in euro, and never in kunas or dinars.

The crucial thing is the currency of the country is now appropriate to the country. A much weaker local currency reflects the weakened economy and we start again. Imports are expensive, which they should be, and exports are cheap, which they also should be. Like in Iceland, interest rates would fall rapidly, and off we go.

By threatening to leave the euro, the Greeks have called the Germans’ bluff. The Germans were playing hardball with the Greeks, and now the Greeks have turned the tables and indicated that they are prepared to push the nuclear button, having decided that the fallout will be felt more abroad than at home. Nothing will focus the minds like this threat. The process of orderly default can now happen in the eurozone.

For Ireland, the one thing we can say with an element of certainty is that this weekend marks a liberation. Once the Greeks are given permission to default by the Germans, we will be next. The bondholders will not be paid, pure and simple.

This is obvious, no matter what language you speak. Some truisms are so clear that they never get lost in translation, even in Der Spiegel.

David McWilliams and Professor Joseph Stiglitz will be speaking at www. on May 16,on the future of the euro and the European periphery states

  1. Praetorian

    In relation to the suggestion that the Greek middle class will shift their money offshore, one downside of default/devaluation is that it tends to wipe out savings. If Ireland does default, which seems highly likely, what pre-steps can the citizen take to protect themselves?

  2. Malcolm McClure

    David says “Greek banks that hold Greek government debts would see the ‘drachmasation’ of their assets,”
    If the Irish government followed suit, presumably the banks would suffer the ‘puntification’ of their assets, so we should consider what this means.

    Urban Dictionary
    Puntification The act of creating an Irish currency for the purpose of dissolving bad debts. Posturing… pretending you are solvent to people that don’t really care what you say, as they know they are going to be screwed one way or another.

  3. Gege Le Beau

    Greece suffers another downgrade of its credit rating. Standard & Poor’s gives country a B rating.

    • wills

      Rating agencies are gangster ponzi scamming fraudsters.

      This rating on Greece has all the hall marks of a gangster firing a shot as a warning through the window of the home of the target.

  4. Hi David,

    Thought-provoking aricle. With the Euro (or its potential spin-offs, New Punt, Drachma etc.) likely to decrease significantly in value with the approaching climax of the sovereign debt crisis in Eurozone countries and given the how feeble the US dollar is at present, which currencies are best-equipped to weather this “EuroStorm”? I would say that the Swiss Franc might be one or the Canadian or Australian Dollar perhaps. The Japanese Yen might still be a risky play given that it is in the early stages of recovering from the tsunami.

    Good on Greece for bringing matters to a head. The quicker the necessary adjustments are made, the quicker a recovery can ensue, even if we are in for a turbulent few months. Look at Russia and Brazil, in the late 90′s they defaulted, within a few years, they were part of the BRIC economies destined to shape development in the 21st Century.

  5. paddyjones

    Greece is only a small part of the EU but the contagion effect is a worry. Ireland is coming a close second to Greece but the difference is that Irish citizens are willing to take the austerity.
    Morgan Kelly suggests that we should eliminate the deficit immediately. That would mean that we should introduce a budget cutting nearly 20 billion now.
    Thats how bad things are here.
    With the bailout the EU have kicked the Irish problem down the road for 2 years, they thought they had done the same with Greece with their 110 billion bailout.
    The problem with the Greeks is that they are not willing to accept austerity which is the only answer to their particular problem.
    In a way the Irish problem is much worse than the Greeks in that we have more debt per capita but the difference is, is that our attitude isnt as bad.
    First comes denial then comes acceptence and understanding the Greeks are just not yet there, they are in denial

    • ” Ireland is coming a close second to Greece but the difference is that Irish citizens are willing to take the austerity.”
      Paddy I for one think you are wrong on that assumption.

    • tonym112

      Paddy, I think your conclusions are severely flawed. Our attitude is much worse than the Greeks. Our politicians dont have the strength to stand up for the people and are accepting a debt that simply does not belong to us. We are in denial that we are part of something that does not work. The euro is failing because countries cannot respond to the economic changes that are happening to them.

      • polysot

        Dear tonym112, as a Median Greek, I feel exactly the same! All the debt was inflated in the eurozone times of Greece, when the -out of Greece companies (i.e. German and French) – were selling their products, etc inflated. FOr example Siemens was paid for a security system, involving Olympic Games of 2004, half a billion€ when the same system cost 100 million to other countries. The difference occurred because of the corruption of the Greece’s politics. And i don’t really believe that the P.Minister (USA citisenship) and its party are going to deny the debts, as they should get into jail a lot of their corrupted – maybe traitors – people. In the same time the median Greek worker is paid a lot less than 1000€ per month while all the staff imported costs much more high in Greece than the other countries, talking for necessary staff of course like food, health and other… So how could we afford the austerity ??? I’m sorry but I can’t and finally it’s not fair.
        P.S. I don’t care about the money in the banks, because i couldn’t have any to get out, as i haven’t stall any all this time. I have only debts…

    • Alanfromnavan

      Have to disagree Paddy. Wait until this government starts to make real hard decisions like introducing water rates and property rates, then you will see Irish people waking up.

  6. wills


    How are we in Ireland going to insure that the insiders running this country DO NOT get to encircle the PUNT and its money printers when we drop the EURO.

  7. wills

    Also, when the euro is dropped, does this mean that the greedy bastard insiders in ireland get away scott free with their swag debt free.

  8. In good old economist fashion ;) I quote myself:

    What were words of truth by Fantu Cheru (UN Human Rights Commission) describing the former World Bank structural adjustment programs, are equally true words today, describing IMF/EU policies:

    “They [are] the expression of a political project, a deliberate strategy of social transformation on a global scale, whose aim is to make the whole planet a playing field in which trans-national corporations will be able to operate with total impunity. In other words, the structural adjustment programmes act as a “transmission belt” to facilitate a globalization process that is based on liberalization, deregulation and diminishment of the State’s role in national development” . In short, they are part of the neo-liberal counter-revolution — a far cry from their claimed objective of eradicating poverty.

    Today we face the implementation of Neo Feudalistic structures and the main test is to see what resistance they have to face when they implement austerity and force bankster bailouts.

    But there is good news as well. As you know, it is my opinion that Ireland needs a debt audit and this press release from last week, May 4th is a encouraging first step:

    I just spoke with the DDCI in Dublin and I will speak to Nessa Ni Chasaide in charge, who is currently in Greece, on her return to get some more in depth informations and will post them here for you.

    Read this article which was co-authored be the economist who appeared in the greek video that I posted earlier. Costas Lapavitsas.

    Ireland needs to stop right away paying back any of these debts, pissing away our assets and freeze all repayments.

    Remember Lenihan’s fare well gift? As one of his last actions before the election he paid back bondholders that held bonds which were bought in 2006 in one single strike, this was nearly the equivalent of one year of social well fare payments by todays requirements.

    The legal basis for the events unfolding now in Ireland was the FF gombeens implementation of the financial stability act, this was forced down your throat by means abusing a dysfunctional democracy and bribing two of the biggest scum bags in the country Haely Ray and Lowry. Well, fuck this act, laws can be changed, and we reject this implementation as a forceful and corrupted act by politicians that acted hostile against the people of this Nation.

    We need to deport IMF and EU austerity priests with their ‘bailout packages’ to Japan to do something useful instead, they can stand in a line and piss in overheated reactors instead of further overheating stocks and markets, then they can take a dump there and leave their neo liberal crap where it belongs, together with radioactive waste.



    The Irish Economy Blog 2:15 PM 437 responses to Morgans article. :)

    P.P.S I disagree with David on DER SPIEGEL, there was a time where his assessment would have been accurate, but not anymore, this paper has reached tabloid level at times, seriously.

    • Dorothy Jones

      I stopped reading Spiegel a long time ago; a lot of repitition of themes which is the way of current affairs publications I suppose. The Rechtschreibreform means that the standard of writing is prescribed so it’s always good even if the content is not.

      The tone and content of Morgan Kelly’s newest article is powerful stuff. It certainly hits the spot; telling like it is.

      • coldblow

        He says that the EU/ECB deliberately wrecked the Irish economy as a warning to the Spanish to stay in line, or whatever. That’s some assertion. I know Deco has been going on about Spain here for a long time but this (if it is true) is shockingly cynical.

      • coldblow

        I used to read it in Eltham library years ago. “Worthy but dull” would have been my assessment. They had a thing against Lech Walesa for some reason. Otherwise it was dutifully pc and soporific. To be honest I wouldn’t read any European papers unless I had to. In my (limited) experience they tend to follow whatever the current orthodoxy is. The language is invariably unnecessarily complicated, but I think this is perhaps covering up for a lack of content. Also, what appear to be ‘qualities’ sometimes seem to behave like tabloids in terms of accuracy or objectivity. For the former, at least one of the Spanish dailies carried lurid reports from Mexico when swine flu first appeared which now seem to have been far fetched. As for the latter I’d refer to the tone of some of the Portuguese papers at the time of Madeleine McCann’s disappearance.

        One that sticks in my memory was when I visited a friend of mine in Sweden during the Falkland War (he was researching into 20th C Swedish nazism and eugenics, which he’d stumbled across while working one summer in their archives – until they eventually refused to renew his work permit). I believe one of their national dailies used to alternate between “Falklands” and “Malvinas” and, if my mate was to be believed, within the same article.

    • uchrisn

      The reason the Asians have built up so much foreign reserves over the last number of years is that they don’t tust the IMF. They feel it is manipulated politically as do many leading Economists. Geithers veto would seem to support that. Many Aisan countires threw out the IMF and did much better for it and never want them back. The IMF needs to change its voting structure to allow the emerging economies have a bigger say, remember the U.S. set up the IMF after World War two when the rest of the world would have agreed to anything to get loans from the US to rebuild their countires.

    • coldblow

      Havent’ looked at it yet. Which is the best of the 437?

      • May 10th, 10:15AM 564

        So far, there were only two relevant post amongst the 564 so far.

        Georg Baumann Says:
        May 7th, 2011 at 2:34 am

        Quote, emphasis mine::

        Odious debt is an established legal principle. Legally, odious debt is debt that resulted from loans to an illegitimate or dictatorial government that used the money to oppress the people or for personal purposes. Moreover, in cases where borrowed money was used in ways contrary to the people’s interest, with the knowledge of the creditors, the creditors may be said to have committed a hostile act against the people. They cannot legitimately expect repayment of such debts.

        I consider the majority of imposed debts on Irish citizens, to repay private banking debts to be odious.

        Georg Baumann Says:
        May 7th, 2011 at 3:34 am

        Note to Mr. Shatter and Mr. Noonan:

        Ireland is not South Africa!

        Political transitions pose complex, multi-faceted challenges for the transitional regime, from accountability for wrongs of the past, to establishing a framework of legal stability and economic reconstruction. Dealing with odious debt from the prior regime usually involves political as well as legal considerations….

        …With respect to obligations of debtor States to private, i.e. non-state, creditors, there is no established rule of international law that requires that these be continued in the case of political transition. Only where changes in contractual rights amount to a denial of justice or otherwise fall short of the minimum standard of treatment of aliens in customary international law, or where these changes can be characterized as an expropriation of property rights or unjust enrichment, can any claim be established against the debtor State in international law. Where odiousness can be established, it would be very difficult for a private creditor or a State espousing its claim to argue successfully that the alteration of contractual rights is a denial of justice.

        • coldblow

          I thought Zhou En Lai’s comments were very interesting. If I remember correctly he took a rather conservative view of the banking crisis at the outset and can certainly not be described as a hothead. Colm McCarthy has, I believe, been calling for a harder line in negotiating with Europe.

          That legal stuff you quote only has relevance if you are the defendant and does not apply to the owners of the courtroom.

  9. Excellent, informative article from DmcW again. But it makes me want to weep.

    Papandreou is smarter than our useless negotiating team of DoF, Honahan, Elderfield put together. We had the full Royal Flush house beat in previous bailout negotiations with our threat of contagion spreading across Europe, but our gombeens instead of milking default for all its worth and rattling our cages with the threat of leaving the euro as Papandreou’s team have done with a deft whisper to Der Spiegel, we capitulated before the negotiations even began with full assurances given to our captors.

    We even came back cheering our bailout success @ 5.8% penal reparations filled with bondholder guarantees and promises on austerity for all.

    If you wanna read more about Our Little Big Horn Lord Cardigan Honahan Charge of the Irish Light Brigade, you can read some more here at:

  10. adamabyss


  11. StephenKenny

    As we said on this site, several years ago, the next step in this wretched chain of events is political extremism: Focussing on the current outstanding debt (as opposed to the far more complex problem of the structural debt), looking for someone else to blame, and then all painting our faces and and going on some sort of giant student march.

    “Recover” is the key word in all of this smoke and mirrors. Apparently Greece will ‘recover’ after they let the drachma float, and so on and so on. So the idea is that the Greek economy was up, then it went down all because of the Germans and French, and once they’ve got rid of the Germans and French, then their economy will “recover”. The same applies to Ireland, Spain, Portugal, and so on. That just about sums up most of the political rhetoric that passes for economic analysis these days.

    Of course what no one’s pointing out is that “recover” is being used in the same way as the word “increased”, as in “the chocolate ration will be increased by -2%”.

    So the debt is cleared, which is absolutely certain to happen, what will replace the economic effect of the vast consumer and state debt that was built up over the Tiger years (the state debt was merely off balance sheet, and is now on).

    The numbers are difficult to find, but they are at least as bad as the UK who’s consumer debt rose from about £450bn in 1997 to about £1.45tn in 2006 – about £100bn a year for every year.

    All those Mercedes and Bouncy Castles weren’t funded by productive wealth creation, they were funded from debt, either directly or indirectly. Go back and read the Pope’s Children – that was funded by debt, not by wealth creation.

    So what happens when al the banners have been put away and the “victory” has been won? What next? Turn Ireland in into an agrarian economy? Have another bubble in something even more transparently absurd that, again, everyone will jump into, and then blame the foreigners again? If we go the bubble route perhaps we’ll be able to offer high paying jobs to some of those children who’ve gone elsewhere to find someone to give them work, sorry, been “forced” to go elsewhere.

    With the bulldozing of the so called “ghost” estates, how close are we to Douglas Adams’s earth, where they started burning down all the forests to revalue the “leaf” after it was adopted as legal tender?

    You can’t blame the wealthy for acting like medieval overlords when the rest of us have never stopped acting like medieval serfs.

    Give the keys back – the Irish no more want Ireland than the English want England – all they see is a sort of McDisney playground, where the adults come out to tidy up after we’ve gone home to fish fingers, a bath, and a bedtime story about the great wealth that we’d made today. We’ll do it all over again tomorrow, after kindergarten, that is.

    • coldblow

      Stephen, on your first sentence, I remember you making this point before on a couple of occasions. It’s the same one that Morgan Kelly makes at the very end of his latest article (and of his earlier “relying on the kindness of strangers” one). I imagine if political extremism is ever to make a breakthrough it would be in these kinds of circumstances.

    • Deco

      Only getting a substantial share of the Greek national debt wiped will result in anything near a recovery.

      And even then, it is assuming afterwards, that Greece gets it’s internal revenue collection process, as well as it’s expansive system of state cronyism reformed. (imagine is even worse than Ireland for party members having their snouts in the trough…).

  12. Interesting and thought-provoking article. However, I’m not sure what you mean by
    “Once the Greeks are given permission to default by the Germans, we will be next”
    Surely the Germans will not agree to this – and can make life v difficult for Greece if they decide to push ahead anyway

  13. Nina Ogden

    If you want to learn German, learn the beautiful Schiller quote (not in Spiegel) which translates “We were born for something better”
    The EU is a bad bank trying to muscle taxpayers to keep it a float. The solution is the RDR era Glass-Steagall Act, now introduced by Congresswoman Marcy Kaptur in the US Congress as the “Return to Prudent Banking Act”HR1489. Reintituting Glass-Steagall sets the model for letting the banksters banking debts go down on their own, without being bailed out by the people .
    European finance ministers are holding secret meetings to discuss how to deal with the debt crisis in Greece, Portugal, and Ireland. The European Union is threatening everyone with dire consequences if they do not capitulate to its austerity demands, even as voters in places like Iceland, Ireland, and Finland make it clear they want no part of bailing out the banks. The Scottish nationalists want to split off from the United Kingdom. Nations are falling like dominoes all across Europe, and everyone knows Spain is next. We are told that nations are being bailed out, but that is a lie: What is being bailed out are the banks, with the nations getting stuck with the tab. The nations are being destroyed, deliberately.

    Ignore the soap opera of official announcements and media spin, and look at the truth. In nation after nation, the economy was turned into a part of the giant global casino run by the Inter-Alpha Group on behalf of the Brutish Empire. Economic productivity was destroyed, replaced by financial gambling. When the casino collapsed, the empire began demanding that the nations cover the bankers’ gambling debts, and impose savage austerity upon their own populations to cover the costs. Now, faced with huge deficits and no productive economy to support those debts, the nations themselves are hopelessly bankrupt and politically paralyzed, and are being tricked into fighting among themselves, instead of working together against their common adversary, the British Empire.
    For more see Click the Glass Steagall button

  14. Praetorian

    We live in a business run society with ‘bank holidays’.

    We have business parties masquerading as political parties and so called politicians who implement policies to favour and protect the interests of business (bank bailouts, continued payouts to bondholders, no referendum/consultation with the people etc). In return for this service, political parties receive donations and if very helpful positions on boards upon exiting the ‘political arena’. Naturally there are the cheer leaders of such a system, those who talk of wealth creation and innovation, of the great entrepreneurial alchemists and risk takers i.e. the Chambers of Commerce, employers groups, business lobbyists, individual business people, economists employed by private enterprise, all of which re-enforces the message of the business run society.

    The ‘citizens’ in such a society have a role, that of the consumer and taxpayer, they purchase the the range of products which were previously rights under the constitution, but which have been commodified, like education, health and of course housing (if they can afford it of course), the latter in particular is often many times their income and so we see the emergence of the indebted consumer (availability of credit made up for the decline in salaries and rise in cost of living, all of which benefitted the business run society). The ‘citizen’ pays taxes (direct and indirect) which assist the ‘political class’ with running the business society. Sports events are saturated with commercial sponsorship and advertising, people wearing their team’s kit become walking billboards. TV programmes are interrupted by advertisements, cinema, radio and internet all follow suit. Time Square is nothing but a mass of flash, brightly lit advertising space for multinational corporations who have amassed more power than nation states with the ‘market’ deciding the fate of so called ‘democracies’ with the push of the ‘invisible button’.

    The business message is repeated by political CEOs (Ireland is ‘open’ for business in the global marketplace or ‘austerity has to be implemented to reassure the markets’ – this is global business society, the bigger game), while there is a revolving door from politics to business to lobby groups and back again. In the business run society, the message is backed up by reports on the how the stock exchange is doing further abstract indicators such as GDP, Consumer Price Index, inflation indicators exist but they tell us next to nothing about social health, the quality and happiness in people’s lives, they are purely about the health of money which is the life blood of the business run society.

    In so called recessionary times (for the citizen more so), the often silent, marginalised, atomised, individualised consumer is pushed more to the centre of events because they have to do the heavy lifting, they must feel the ‘pain’, take ‘the medicine’ after their ‘excesses’ because ‘they all partied’ (nicely reinforced by the corporate media). One however for a brief moment has a sense amidst the public angst around declining wages, unemployment, a parallel track within the business run society between those who wish to keep it as it is and those seeking a society that operates in the interests of the people, marches in Ballyhea for instance, petitions, marches (the society allows for a certain flexibility but not too much).

    Politicians attune to the anger and resentment play lip service to the citizen in the business run society because the electorate needs some crumbs while simultaneously great effort is made to reassure business (those formerly known as the ‘merchant princes’, ‘captains and kings of industry no less) reassured that the corporation tax rate will stay low, State assistance is guaranteed and the country is a great place ‘to do business’. But it is worse than that for the citizen; the wrong doers do not get arrested for alleged business fraud, bankers walk away with bonuses while quite extraordinarily, banking monopolies emerge (precisely the scenario you don’t want as a consumer). State media reflects the interests of the power elite with stories about ‘green shoots’ and ‘corners turned’ while the working poor, the unemployed are marginalised in the hope they are forgotten or serve as a warning to anyone who may want to cause problems like protests in the business run society.

    Those who do not realise the extent to which we operate within the matrix of a business run society naturally wonder how can things be the way they are? How can politicians be so ‘stupid’ to give a blanket bank guarantee way beyond anything that was required? How can a Prime Minister be earning many times the average industrial income at a time of ‘national crisis’ (a crisis for who?) How can banks that have been bailed out with citizens money turn around, layoff thousands and increase interest rates on already hard pressed consumers? But when seen through the eyes of the business run society these things do not come as a surprise, they come to be expected.

    People wonder what the future holds, it is not that difficult to predict using past actions as a guide, policies that benefit the business run society and not the citizen will be implemented to the degree to which they can be, no more, no less. Multiple visits by Irish Prime Ministers to the financial Mecca that is Wall Street (the centre of the problem in many ways) with the ‘please come do business with us’ tells you all you need to know about the kind of lessons that have been learnt.

    • Deco

      The Irish concept of business is very committed to getting business from the biggest con-artists in the business.

      We sold out our self-respect many years ago. Rise and Follow the Squire of Kinsealy. We bought the BS hook line and sinker.

      Version 1. “….a matter of grave national importance…as a community…we have been living beyond our means for quite some time now…we need to tighten our belts.”

      Version 2.0. Lenihan says “we all partied”.

    • adamabyss

      Brilliant post Praetorian.

    • adamabyss

      From the BBC Website –

      Mr Geithner also said that China should develop “a more market-based economy and a more sophisticated financial system”.

      Sophisticated financial system? Here we go again. The greed of these people is just endless.

      • adamabyss

        Financial systems should be simplified, not made more ‘sophisticated’.

      • Deco

        Well….what a stooge he is. I mean the Chinese actually accumulate money, and are able to spend it on infrastructure and development. And Geithner lambasts them for the fact that they don’t throw it into a casino type arrangement like Wall Street.

        This tells us everything about Geithner, and his fitness for the responsibility he holds. A complete stooge.

        ‘Sophisticated’ is a code word for so complex and messy that nobody has a clue what is going on in there. A safe pair of hands for our lobbying sponsors.

  15. BrianC

    I would beg to differ regards ‘the Greeks like us’. I would suggest it would be more accurate to say the Greeks unlike us.

    We are no Greeks. We have a spinless Government which is not prepared to represent the true interests of the Irish Nation. Rather they have a firm resolve to protect the few with the asinine believe that Ireland can afford this bail out and works its way out.

    The Irish Government clearly acts in the self interest of the few. We as a nation are a stupid people a very stupid people which is far worse than being ignorant. Just listen to PH defending himself. It is very disturbing to listen to MMcD and the rest of the status quo sort.

    We have a spineless Taoiseach with lame ideas. He does not want to be the one to give a lethal injection to the Irish Economy. Kenny is an incompetent moron and ought to have the gravitas that Patrick Honahan administered the injection already and his job was to reverse it.

    They are just pure stupid end of story. No matter how many times they are given correct guidance they cannot take it because once again they are too stupid and too interested in feathering their own nest. You could say that by feathering their own nest they are not that stupid but the simple fact is that they are too stupid to even know they are feathering their own nests.

    Just in case by any miracle of a chance that any of them read any of these blogs maybe they could look up and study the modules on Banking and Money, Credit Crisis, Geithner Plan, Paulson Bailout. Then you can do the other modules on economics and finance and we might stand a chance. Or better still appoint people who know what they are talking about and have called the situation correctly.

    • Deco

      Greece might be a basket case, but the people in Greece do at least understand the basic tenets of democracy.

      We on the other hand have an image of ourselves as a modern sophisticated, etc…etc… The image is proving expensive to the point that it is driving us faster to becoming what we are really becoming.

      Worse than the Greeks. A basketcase with a shamocracy of Suds, Honohan, Ditherer, and all the other grovellers and snouts in the trough leading us into an abyss.

      Sure it will be all solved if we hand Coillte over to the ECB, right ? Then we can go back to being the laughing high spending hard drinking fool of Europe again.

      • Deco

        Meant to say

        We on the other hand have an image of ourselves as a modern sophisticated, { insert whatever adjective gives you the right to think that you are fantastic }etc…etc… The image is proving expensive to the point that it is driving us faster to becoming what we are really becoming.

    • Well said Brian!
      However I doubt if they’ll read any of this.
      They probably once did?
      But such intelligent observation can make their denial difficult and uncomfortable.
      Lets face it if an honest politician (apologies for the naivety!) were following this site they would surely come forward to interact, point of fact, agree or disagree?
      Afterall direct communication with some of the more conscientious electorate would surely be an honourable thing? (apologies there again for that naivety!)
      When this national tragedy plays out to a point of conclusion we really do have to come up with a better way to manage our affairs!
      Only when we stop rewarding for constant ineptitude can we truly claim to have made progress as a society!
      And while we tolerate ineptitude we deserve no less than the label of stupidity!

  16. If what Les Echo reported is correct, and I would not be astonished, again France and germany dictated the course according to a EU insider source that spoke with Les Echo. Essentially, another band aid of 25 bln is considered to patch what is already broken and no longer possible to be fixed.

    What we witness is how a crisis mechanism mutates to normality.

    The whole game played here by EU technocrats is DELAY UNTIL 2013 by force! This however does only one thing, and one thing only, it makes the inevitable default for Greece, and Ireland of course, much more costly!

    The reason for this forced delay is to be seen in banks and insurances, who force this through their lobbies, they gain valuable time to leave the Greek and Irish stage completely, but not before making a massive profit on CDS fraud, Greece is a up 122 bp today, the largest increase in one day.

    This is all about minimize the costs for banksters and maximize for taxpayers.

    Remember the full, and already way too weak, Basel III Implementation is not going to happen before 2018. What a joke!

    Increasing the Greek debts automatically increases the risks for Spain, inveitabely next on the list.

    If Spain falls, the damage would exceed the current E 750bn EFSF, and with the UK already indicating that they have no interest to pay more into this insane package, the pressure from Germany and France increased.

    • Deco

      It will get really interesting when the taxpayers in Germany realise that they are bailing out their own speculative sectors…..And for the French this will be a massive dilemma, when they realise the EU actually requires France to put in more money than it is getting out….then it will realise what the Netherlands has been doing for thirty years, and will the French will get a very different feeling about all the corruption in Brussels.

      • Praetorian

        If reports are anything to go by, both Sarkozy and Merkel could be out of office in their respective elections. In France, polls seem to indicate that the head of the IMF and millionaire ‘socialist’ Strauss-Kahn might be the next up, could a change of leadership usher in a change of policy?

        • I prepare the Hit list.

          Where is Charles Bronson?

          • There must be a lot of ex special forces, KGB, what have you type ramboo’s around. let’s support Max Keiser’s Kill the bankers tour and start a collection, get a team together and send them around the world, starting with Monaco.

            2 Months later the world will be a better place!

        • Deco

          Unbelievable. A complete joke.

          A Champagne socialist(DSK) replacing a champagne showman(Sarko). For ‘opposition’ there is Mme. Le Pen. France is going to become a disaster state, with a powerful finance oligarchy who can put Kerviel into jail for a long time for messing with their money, but who acquit politicians like Chirac when there are charges concerning corruption.

  17. Part of the problem is that the trash appearing across the EA just can’t be hidden anymore, its even coming up out of K Club gold courses:)

  18. Willie C

    Bit of an attack on David McWilliams in yesterday’s IT

    “Celebrity is not measure of an able economist”

    by Richard Tol is a professor of economics at the Vrije Universiteit Amsterdam and is also research professor at the Economic and Social Research Institute.

    The ERSI certainly didnt cover themselves in glory in the past years. Richard Tol is a very interesting character also…. he’s quoted by the US Republican party as “scientist who doesnt believe climate change will have severe impact on humans” – has been accused of fabricating his science.

    Any credibility left with ESRI at all?

    • PMC

      The most important part of that article is the last peice:

      “Richard Tol is a professor of economics at the Vrije Universiteit Amsterdam and is also research professor at the Economic and Social Research Institute. He knows about energy and the environment, but not about much else”

    • Is he still at it?

      …. He posted the same blather 6 weeks ago already….

    • Just read the Richard Tol article there and unless I remember incorrectly David McWilliams advised that the guarantee be allowed to lapse once it had served its purpose (to prevent a panic and a run on the Irish banks). At no point during the Sept 08 to Aug 10 period do I remember Tol and the ESRI saying that the bank guarantee was an awful idea and had to be changed immediately. Whilst academic prominence is an indicator of expertise to some extent, it is by no means the only one. Academics observe what is going on in the marketplace, but are rarely active players (e.g. work in investment banks, depend solely on their own businesses for income etc.). To say that academic expertise is the best indicator of expertise is like saying that those who watch football and study all its finer points but do not actively play know most about football. For me there is no substitute to real-life experience of being an active player in the game.

      If Tol is such an expert, why doesn’t he offer his solution to the crisis we face and put it in a mainstream newspaper like the Irish Times instead of writing academic articles that are often only published several years later?

    • Praetorian

      Would be interested in seeing Tol’s comments if any on the property bubble prior to the crash especially around 2003 when McWilliams made his famous appearence on RTE.

      If we were to live and die by ‘experts’ and how many citations they get then I can almost imagine the kind of world we’d have, remember Galileo? Some of them also don’t come out too well in the film ‘Inside Job’.

      • I am actually astonished that no one has accused david to be on the payroll from GS for his attempts to talk down the Greek economy.

        Bruton? Fitzgerald? No one?

        Come one guys…


        • Gege Le Beau

          The interesting thing about the attack on McWilliams is that the individual who launched it did not challenge David on his views/thoughts, he challenged him on the basis of not having the proper ‘academic qualifications’ nor publications in Peer Review Journals (with citations), yet the astonishing aspect of the boom period was the silence from academia (with notable and honourable exceptions) and ‘group think’ from experts that re-inforced the prevailing and erroneous consensus. Fitzgerald may be cited x-hundred of times but I wouldn’t subscribe to his brand of economics while those associated with the ESRI are the last people to be throwing stones.

          I disagree with David on a lot of things but I keep going back to that 2003 moment in my mind, he stood up and made a big call and staked his name and reputation on it, his call was right and that is what ultimately matters as we stare into the economic and political abyss, many other academics and economic pundits got it badly wrong but still pull their salaries, people bought their message and many of them have not fared so well.

          • Deco

            It is a pity that Richard Tol was not so forthright in his opinions when we had one lawyer replacing another as head of an economics ministry ?

            Or maybe he was OK with that because they were both stooges ?

  19. Time for Outrage!

    The 93-year old author starts with a brief reference to his participation in the French Resistance at the end of the Second World War, pointing out that outrage was at its roots. He then outlines two, somewhat contradictory, views of history that have both influenced him, that of the French philosopher Jean Paul Sartre, who was his teacher at the Ecole normale superieure in Paris and that of the German writer Walter Benjamin, who was a close friend of and collaborator with his father, Franz Hessel. The author asserts that indifference is the worst of attitudes. He speaks of his experience among the drafters of the Universal Declaration of Human Rights and exhorts young people to look around for topics of indignation. He then presents his own principal indignation at present, the strife in Palestine, the Gaza strip and the West Bank.

    He ends the tract by calling for non-violent action and for a peaceful uprising against the powers of finance capitalism.

  20. uchrisn

    Just read John Brutons piece in the Irish times today. I was reminded of Irish history is a long story of how informers and traitors have blighted Irish stuggles for justice in return for money, lands or favor from the oppressors.
    On the main reasons for the financial industry employing John Bruton is to lobby the Irish people and government on their behalf. The exact same as Peter Sutherland.
    In this case they are both offically working for the financial industry. However they would try to make out that they care about Ireland and the best interest of the people, that they are with us. They decieve many.
    John Brutons article contains such statements that I am surprised at how far he goes. He seems desperate. Iceland is part of the single market despite not being offically part of the EU. Nobody has even talked about them being eliminated from that as a punishment for making bank bondholders pay for their rightful losses. Trade wars helped cause the 2nd world war and the G20 has said firmly it will not engage in them any more. In my mind there is absolutly no question of Ireland being eliminated from the single market and noone in Europe has spoken about this. However Mr. Bruton is choosing to try and scare people in Ireland.
    At this point I have to appreciate people like David, Morgan Kelly and others who have integrity.

    • Deco

      Bruton, Suds etc.. are careerists whose main defining attribute is a complete inability to do any original thinking, and whose every argument amounts to instructing the people that it is in their best interests that they obey something bigger, and more imperial than their own private needs.

      Welcome to the nEU empire project.

  21. uchrisn

    In fact I should add that Iceland has appied for EU membership in 2009 since not repaying its banks debts and the EU is going to welcome them with open arms in 2012 despite continuos referendums saying that they won’t even refund foreign depsoitors.
    Mr. Bruton is really off the ball saying we would be emilimated from the EU and the single market for doing less than Iceland.

  22. Peripheral Default

    We had this before over ten thousand years ago .At that time the centre of The Economy was what is now in the middle of the Atlantic and that was where the collective management centre was .It was during the age of Gemini ( Air Element ) when everyone believed between themselves that their ignorance was more intelligent than it was .Then an alignment occurred in the heavens where planets arranged in a straight line created a solar pull and resulted in the oceans appearing above and the earth sinking below and all that was left was the remnants on the peripherals .

    One of those peripherals remaining standing today is Dun Aengus a semi-circle where once it was a complete circle made by man and now what you see is made by both man and nature .This was a Time when what then mattered came from the West where the centre was .

    In to-days world in the EU this same management is now in the East and Merrion Square is on the peripheral .When the next solar alignment occurs what we now know will show its new centre of gravity in Germany ( Mittal Europa) and a new semi-circle in Marrion Square, a peripheral .. The moment for this is in the current Age of Aquarius ( Air Element ) where everyone believe between themselves that their ignorance is more intelligent than it is only this time recreating it in multiples of units of greed and lies .Soon a new alignment will appear in the heavens where the planets will conspire in a cosmic energy and the meek will inherit and the pillars of society will fall .And all that will be left will be a new remnant of free slaves from the shackles of Slave Traders and the island surrounded by Pirates of Penury .

    Where once the West rose now the East appears and our compasses realign in substitution to what was before and the sun remaining unchanged .Afterwards the Winds arrive and will change the new status quo and The Pirates of Penury appear in their long boats to ravage the lands once more.

    It is now time for tall round towers and high entrance levels and narrow windows and may your sun shine where your weapon lies .


    Against the will of it’s own people, without a referendum on this matter of national importance, Greece was forced to take on E 110 bn in debts from IMF and EU.

    GDP is down and will continue to go down further. FT and WSJ both report additional E 60bn to be on the table.

    ECB refuses restructuring of debts.

    The political incompetence of the EU Leadership has got to the point that they risk civil war in Greece.

    How much more do the people in the periphery states need to understand that they are truly treated like a PIG that will be slaughtered?

    How much more does it take before the people of these Nations stand up for themselves?


    This is from May 5th 2011, and should tell everyone what this school teacher is really about. INCOMEPTENCE!

    • Colin

      He’s enjoying being the Taoiseach. He loves walking around shaking people’s hands. He’s just hoping all the country’s problems will disappear. Sure God is good. And if the sh1t hits the fan, he can blame Fianna Fail. See, its easy being the Taoiseach.

    • Deco

      Begining to wonder what the story is wtih Kenny. Going around like Mr. Soft.

      The Greek PM played hardball at the weekend, and ended up winning concessions for Portugal and Ireland as well as Greece.

      Colin – your appraisal of Kenny is looking frighteningly precise. Behaving like as if he was back in Castlebar, having the craic with his pals. The situation that we are in requires a more serious and intentful approach, rather than going around as Mr. Smiles.

  25. coldblow

    As I mentioned last year my German teacher, following a visit home, returned with a set of simplistic but strongly held opinions, which she said she had got from Bild (she doesnt’ beat about the bush) about the injustice of Germans bailing out feckless Greeks. I pointed out that it takes two to tango but I don’t think she was receptive to this line of argument.

    I like her. She came back here to live a year or two ago (she had lived here some years previously) and was entitled to no welfare benefits, but she didn’t mind and made a living from teaching, translating, waitressing and tour guiding. She didn’t need much to live on and she saw living on a pittance as a worthy challenge. She was brought up in a typical household where you were always expected to be doing something productive (one of the conversation group agreed, saying that when an au pair in Germany some decades ago she only had a half day free per week but couldn’t relax in the house as she would always be roped into doing something useful).

    I suspect Bild’s is the view held throughout Germany, just that it’s dressed up in impenetrable language at a higher level. As a written language German is pretty special. It can obfuscate. It can be very effective for comic purposes. Translations of say the Tin Drum don’t come near to the original where the timing of the sentences turns it into an amazing string of punchlines. In fact some of the best comedy ever written is in German and I have to pause right here and scratch my head and reflect that that is soooo weird. Or it can meander over the pages in endless sentences, as in Sebald’s novels, which lull you and confuse you and hypnotize you and these oppressive, asphyxiating feelings are released from somewhere down below. Or is that just me? Careful with that axe, Eugene!

    Shame it’s so difficult to learn. Could be why so many Germans just watch the sport instead. Or read books in English.

    What did the poet say? Something like

    English is a necessary sin
    Suitable for selling pigs in


    Will be posted exclusively on Davids site…..Stay tuned…..

  27. vincent

    We still seem to be told “if only we could get more people spendind their money in the economy” spending on what?-more junk that we don’t need. The idea that we can somehow spend our way out of this mess would probably sound strange to a child, maybe that’s what we need running the country-children, children could hardly have done as much damage as the “highly educated” muppets/puppets that we have “running the country”

    • Praetorian

      The calls as you correctly point out is designed to stimulate consumption (keep the high street going and businesses open despite all the things the government has done to working people including slashing wages and threatening them with increased taxes which has severly reduced disposal income and consumption). Consumption helps the ‘growth’ figures, the magic number that entices the market.

      But the reputational damaged done to Ireland internationally by its own financial/business community (cooked books and shady practices) and politicians (denying bailouts)is very hard to overcome especially when you have a leading broadsheet (Financial Times) citing events here as: “cosy capitalism at its worst”. There is great uncertainty around our affairs and for good reason.

  28. Praetorian

    A High Court judge has extended the Director of Corporate Enforcement and Garda investigation into Anglo Irish Bank to the end of July only after expressing serious concern the progress of the two year probe “is not at all satisfactory”.

    Mr Justice Peter Kelly also strongly criticised the failure to mount any prosecutions in other Commercial Court cases despite “prima facie evidence” and even admissions of criminal wrongdoing in such cases and where papers to that effect had been sent years ago by him to the authorities.

    “This is not a desirable state of affairs,” he said. “An apparent failure to investigate thoroughly yet efficiently and expeditiously possible criminal wrongoing in the commercial and corporate sectors does nothing to instill confidence in the criminal justice system as applicable to that sector.”

    • Colin

      I don’t think they encourage investigative work in Templemore. Its more like training for taking to the highways and annoying motorists with tax and insurance and NCT checks. They also love attending sports events even though there is absolutely no need for them to be there.

      We don’t have a Police Service, we have a Police Disservice.

    • Hide, destroy and delay was the tenor from this so called Investigation.

    • PMC

      This shouldn’t surprise anyone in the slightest.
      The Gardai wouldn’t have a notion of how to investigate white collar crime of this level.
      I’ll put money on it that outside policing consultants are trying to “teach” the Gardai how to go about this – for astronomical fees of course; no worries though, the taxpayer will foot the bill…

  29. BnB

    Even the insider Harvard-educated finance minister Papandreou is making some effort to represent the interests of the Greek people. We’ve also seen leaders in Iceland and Finland refusing to make their population pay for other people’s debts.

    While this kind of reaction can be found in all kinds of countries from the Arctic to the Aegean, for some reason we don’t find it in Ireland. If the ECB decides something, you just have to accept it. The strongest statement that you’ll hear from an Irish minister is probably Leo Varadkar’s claim that Ireland should not pay more than Greece, whose interest rate is 1% less. Never mind that this would make no difference to Ireland’s ability to pay back the full loan. Never mind that this is being charged on money that was not borrowed by the Irish state or its people in the first place.

    Pat Rabitte, Lucinda Creighton and others have been falling over each other lately to be the first with the great news that there might be a drop in the interest rate. Too bad that they were left looking like eejits today when a German Finance Ministry spokesman said that this would happen without Ireland increasing corporation tax in return.

    • Yes, in Ireland they preferred to have european Day Celebration instead, Luke’s response to that disgusting display of disrespect to their own people was correct.

      • adamabyss

        People here are more interested in Arthur’s Day, which is Patrick’s Day, Mark II – another excuse to stay in the pub all day and piss your life away – mind you I know plenty of people who do that every week on a Sunday.

        • Deco

          Well said.

          We have enough sacred cows in this country, without the creation of more at the behest of “our advertising sponsors”. “Beer and Cricuses” is undermining any effort at creating the type of intellectual culture that will remedy the problems and systemic flaws that we face in our society.

          • Gege Le Beau

            The Roman’s knew it, so do the modern imperialists. Distract, delay and make indebted.

          • Deco

            Gege – I think you are right.

            Dumb down the proletariat – and make them work from compulsion. They will be too busy to get any big ideas about how the society is run.

          • Gege Le Beau

            @ Deco – one of the issues is people have little knowledge of history. I studied Greek and Roman civilisation and general history for years and years, read everything I could get my hands on and thankfully my passion today is as strong as the day I was first gifted a history book and discovered the Egytpians, the Mayans, the great civilisations and of course the amazing stories from Irish history, the remarkable characters, the never say die spirit, the monster political meetings of O’Connell and Parnell.

            One of the great benefits of history is that is gives a remarkable context to events, it is the ultimate background knowledge (events cannot be understood in isolation).

            Now I see more than ever the damage that can be done to a society which has no ‘memory’, a society that does not give its people the space to read, reflect, learn from one another, a society that prefers to see people aspire to the 4×4 and home in the sun, ruthlessly individualistic and exploitative. Because of this lack of knowledge of the classics, the important historical texts, Greek mythology with all its wisdom, detailed knowledge of the Roman Empire and all the other Empires that followed, generations tend to have to reinvent the wheel and just when they come to some sort of understanding of the world around them the next generation appear largely clueless but full of energy and almost blind intent, only a very few get the family history, the societal history and the ancient history passed on to them, and they are all the better for it, but I have a sense the lack of communication in families, especially between father and sons is an enormous stumbling block which the ‘Irish’ have not really overcome, sure fathers and sons can talk sports for a while maybe even politics, but a real bond seems very absent from what I have seen. This strikes me as a disjointed and sad to say it, impoverished and underdeveloped society especially in the sense of the bond I just mentioned.

            Maybe instead of the X-box or latest i-phone, adults should give the children a history book and then take the time to go through things otherwise in time they too will be robbed blind and will spend too much time trying to figure out how and why while the criminals make off with the loot.

  30. Does anyone know some figures what the superfluous visitations of Obama and the British Royal Monarchy representative will cost the Irish taxpayer?

  31. Oh my God…. is anyone listening to Noonan? Am I the only one with the impression that he has NO CLUE what he is reading there?

    • Deco

      This is the stooge that presided over the Brigid McCole Scandal in the 1990s. No doubt, he is trying his best – but it does not require a very difficult issue to show up Noonan as an amatuer.

      There is a very painful personal story going on in the background – and for this reason the media are being soft on Noonan at the moment.

      And in addition, he is Minister for Finance after Lenihan and Cowen. A very serious burden for anybody to have to bear.

      • Well, we all have great personal pain and burdens, and we all make choices, so did he.

        Ah well…. what do you expect from someone with this view:

        Europe has been very good to us . . . They’re actually treating us very well.

        • Deco

          Actually, I reckon he should resign for personal reasons.

          And also maybe to let somebody younger, and with an education on economics take charge. There still is time for Kennylite to nominate an economist to the Seanad and to install him as Minister for Finance.

          But he will probably go with a collection of bores from the backroom of the two main parties, and press the snooze button by sticking in a few clowns, with no ability, who will say womderful things about him.

          Just got details of the Noonan plan. It seems rather unusual for a country tthat has a solvency problem to be taxing savings – I mean he might cause a rush for the exits.

        • Julia

          For God’s sake. It’s battered Finance Minister syndrome.

          We just had a union meeting in school today. Every one is in despair. They’re paralized. Nearly half the staff are part timers and are terrified of losing their jobs. We all know the Croke Park Agreement is a no hoper. That was never going to work.

          And then there are 450 people out of work in the country. Plus 1000s of people leaving the country in search of a better life abroad.

          I’m very depressed this evening.

          • Julia,

            It helps to distance yourself 100% for a certain time from all these events. Seriosuly, no news, no papers, no Internet. Walks on the beach, the woods, wherever you are, but totally switch off and do nothing but enjoy life. You need to recharge batteries and maintain what I call psychological hygiene.

            This stuff has the potential to make people sick.

            Take care of yourself!

      • btw. Even ;) Spock resigned his command for reasons of being emotionally compromised.

        • Julia

          Thanks for the kind words Georg. Just turning off VB now.

          You are absolutely right of course. I’ll be out to the tomato and strawberry plants in the garden tomorrow. The herbs are leaping out of their pots and the first rose buds are about to open.

          As for Spock – you can be Spock – I’m more of a McCoy – you know – ” Goddammit man – can’t you feel anything? ”

          Oíche mhaith.

          • Gege Le Beau

            @ Julia – I went to the cinema to balance things out, the movie ‘Thor’, I enjoyed the escapism, I came home and Vincent Browne was on, more talking heads, so off the TV went. You have to have balance because these issues are highly toxic, make sure to exercise and do other things, above all don’t get consumed by negativity, amazing things happen all around us every second of the day just a question of what you chose to focus on.

            Be in the world but not ‘of’ the world because what was been done financially to Ireland was pure madness, and such things which are beyond the power of any one person can drive a person ‘mad’ with anger, or depress, get down etc, do not fall into that trap.

          • LOL… the Spock comment was on Mr Noonan, not you.

  32. Deco

    We have a new word tonight concerning Greece

    REPROFILING of Greek Debt.

    It is a politically correct version of saying “partial default”.

    Merkel is talking about it publicly.

    Sarko is completely silent. Whenever Sarko is looking for something that amounts to screwing taxpayers somewhere, or cutting people’s social services, in order to protect certain Finance houses, Sarko goes silent until the deal is changed in favour of his agenda.

    This is the Greek populace versus the French Regime, with everybody else positioned somewhere in between. Barosso is on the side of the French regime.

  33. “True Finns party chairman, Timo Soini launched the most scathing and accurate attack yet against Jean-Claude Trichet, Jean-Claude Junker, and the ECB for its policy raping taxpayers of various countries to pay back German, French, UK, and US banks that made stupid loans for stupid reasons.”

    • Deco

      I recommend you all to have a look at the commentary concerning Kennylite – or “Edna Kenny” as ‘Mish’ calls him.

      Edna Kenny is a Liar Too

      Four days ago Kenny said “the nation can handle its debts”.

      Today Kenny says “questions of sustainability remain”

      Which is it?

      Irish taxpayers should not suffer from voting out one set of clowns in a landslide election only to have the new set of clowns adopt the identical policy.

      So there you have it – Kennylite has been exposed as a hypocrite. By the way, nobody in the Irish media noticed this yet. Maybe they are more interested in advertising revenue from the two “pillar” (sic) banks. I reckon that this is the case. That the media will not do anything that might offend our advertising sponsors, considering that the ECB now controls our advertising sponsors.

      As the title of David’s book says…”follow the money”. At the source of the money comes the source of the deceit.

  34. For those of you who are interested, the following link contains the statement that David McWilliams made on the Irish economy in 2003. If only we had paid attention….

    Also, the extended debate on Prime Time with Austin Hughes (IIB Bank), a so-called economics expert:

  35. Deco

    The main plank of Noonan’s plan.

    Not sure how this will work. But if we are trying to prevent a bank run in this country, is this a bright idea from Noonan. I mean, it would be nice if he were to get away with it – but sometimes you think you can get things done, and it does not work out that way….

    • Hmm, looks like the raid on savings has started. It starts off with pensions, deposits are probably the next target.

      Interesting to note that this levy will not be imposed on public sector workers as they’ve already taken a “pay-cut”. Well, the private sector workers have taken more than just a “pay-cut”, and are now getting nailed with the pension levy as well!!! it just goes from bad to worse.

      • Deco

        No mention yet of all the quangoes that Kenny was going to cull. No mention of reforming the public sector – though James Reilly is doing something at least in respect of the HSE.

        Public pensions are going to have to get taxed. Some people are getting 100K per annum of a pension and it is completely absurd. It needs to be remedied immediately. They are dithering on the issue of the efficiency of the state – and state efficiency is not all about pay.

        • Don’t be so negative, don’t you know that they all are ‘Working hard behind the scenes’? Every time I hear this sentence I wanna throw up.

          Let’s nuke the Caymans as a start to solve this crisis. Then hire the worlds most sophisticated hackers and bring down fail safe etc of FED and ECB.

  36. Deco

    The “Proof of Concept” theory of managing the PIIGS.

    Basically, the ECB will arrange a fix of Ireland, that will act as proof of concept, when the news is eventually released concerning Spain.

    Theoretically, this will sucker the markets into thinking that the ECB can fix Spain.

    It takes massive intellectual arrogance to seriously think that such a theory would work. But that should not be in short supply from Brussels.

  37. Sucks Dryson & Swallow

    Today marks the beginning of the opening of a new firm of cosmic endurance .It will be affiliated to the holding company Moon Inc a Universal group of loonies who attach themselves to everything that moves including sporting fixtures and mandarins with a merrion touch .It will remain in the country for the next seven days and will oversee Everything around us .It displaces all known foreign viruses already in situ .It is noticeable by the PULL felt and watching a row of Topples within your eyesight distance .There is a heavy Heart Beat too that sometimes travels to the head and after that anything can happen.

    It is advisable to carry an antibody ‘ SLOW ‘ to ward off any possible fatal encounter because you will need it.

    aka FULL MOON Madness

  38. paddythepig

    What David is proposing here is thievery, pure and simple.

  39. coldblow

    I expect that those people who are on fixed wages and pensions (plus the deserving poor) would get hammered in a Euro exit as would those who hadn’t offshored their savings (or ‘savings’). So what’s in it for them? And the conscientious objectors who won’t play the game? My earlier hunch was that when a certain proportion of the population had offshored their savings (not too large as that would impair relative advantage and perhaps provoke retaliation from other countries if it became obvious that everyone was at it – there’s only hiding place for a few stowaways – anyhow we’re talking quality here not quantity) and a tipping point was reached, then the ‘public mood’ could suddenly turn radical. (A bit like 1916 perhaps?) When the deed is done and the hot money returns sniffing for bargains, what will the saps be told? This is capitalism, we are where we are, get over it?

    Is there any hope for Ireland without enforcing full financial disclosure for all, whichever way that can be done? You’d expect perhaps a (certain) degree of solidarity among the citizens in some other countries, but not here I’m afraid. Behind the blarney there seems to be a hard realism, born of experience no doubt. Every man for himself.

    Am I going OTT here?

  40. Great, former Goldmann Sachs managing director Draghi who was director general of the Italian Treasury from 1991 to 2001, and who he headed Italy’s privatization program after 1993 will be the new ECB Mafia boss.

    What more can you ask for?

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